A global investment syndication platform for private opportunities, CapBridge serves mid-to-late stage growth companies and the funds that focus on them. Using a co-investment model built with investors in mind, WealthUp speaks to Johnson Chen, Founder and CEO of CapBridge.
Q: Thanks for taking the time to speak with us. Could you share a little more on what CapBridge does?
CapBridge is a global investment syndication platform for private opportunities. The co-investment platform serves mid-to-late stage growth companies and the funds that focus on them. Our co-investment model is built with investors in mind.
We first bring opportunities to professional institutional investors, who leverage their specific industry knowledge to conduct due diligence, negotiate value adding investment structures, and manage their portfolio positions to the desired exit. We then open up the same opportunities to co-investors as they leverage on the professional institutional investors’ expertise in specific industry fields and diligence work.
Co-investors sign with the same terms as the professional institutional investors and realize better risk-adjusted returns and a more likely exit. Co-investors with smaller ticket sizes can also take part through Preferred Access.
Companies benefit from working with professional institutional investors who understand their sector well and can directly value-add, as well as broadening the shareholder base with co-investors who can add network connectivity and assist towards a more successful listing further down the road.
The co-investment process is conducted electronically on our intelligent platform, which works ceaselessly to match deals with investors and facilitate the deal process.
Q: With many investment syndication platforms around, what makes CapBridge unique?
We are one of the very few fully-regulated private capital marketplace that offers companies and investors institutional grade investment opportunities from high-growth private companies.
The traditional private investing space is a fairly closed system where firms take a long time to seek out potential investors and close a deal. Such deals typically emerge out of the informal networks of bankers and brokers.
With CapBridge, companies and investors have a formal marketplace that reaches a far wider audience than what you would be able to achieve on your own. And by aggregating the collective demand, the price discovery mechanism is much better and more efficient.
There are currently about US$900 million worth of deals on CapBridge available for investors to partake in.
We also allow accredited investors to invest in high-returning private securities through Preferred Access. For as little as $5K, investors can diversify their portfolio while riding on the experience of PE/VC experts leading the deal for better returns.
Our platform provides a secure and effective environment where investors can confidentially access growth stage companies seeking finance.
The CapBridge platform efficiently tailors specific deal types to each investor, showing them only the deals that meet their investment criteria.
CapBridge also integrates useful tools that optimise time and resources, including dynamic profiles, engagement tools, due diligence facilitation, deal flow management, secure data-room, and dashboards.
Our vision is to build on this demand and develop CapBridge into a world-class marketplace for investors and companies to achieve their growth objectives in an intelligent, secure and efficient manner.
–Johnson Chen, Founder and CEO, CapBridge
Q: How do you see CapBridge growing and developing in the coming years?
The private space is increasingly outpacing the public market in terms of investments. In 2017, private equity (PE) deal value in the Asia-Pacific was more than double the initial public offering (IPO) proceeds from stock exchanges. Just five years before, PE funds outweighed IPO proceeds by only 37 per cent.
Our vision is to build on this demand and develop CapBridge into a world-class marketplace for investors and companies to achieve their growth objectives in an intelligent, secure and efficient manner.
On the back of CapBridge’s success, we recently launched 1exchange, one of the world’s first regulated private securities exchange. Private companies can raise primary capital on CapBridge and then elect to list a portion of their shares on 1exchange. This listing gives companies more capital flexibility, while offering existing shareholders exit potential and other investors the opportunity to partake in the companies’ growth. Companies on 1exchange remain private and need only adhere to light-touch listing rules.
1exchange is also built on the blockchain, which enables the exchange to connect to the millions of digital asset owners around the world to offer them regulated and tradeable private equities as an investment alternative. 1exchange is based in global financial centre Singapore and regulated by the Monetary Authority of Singapore.
With CapBridge and 1exchange, we hope to offer a holistic private capital solution to companies and investors. Together, the two offer investors institutional grade investment opportunities – in the form of pre-IPO positions via CapBridge, and secondary tradeable private equities on 1exchange.
We believe this eco-system that encourages private capital flow is an integral part of the private investing future.
Q: What do you think clients love most about CapBridge?
CapBridge has seen a lot of interest from family-owned firms in the region. These companies hope to use 1X to manage their capitalisation table for succession planning, or to provide second and third-generation shareholders with a degree of liquidity for their holdings.
Feedback from companies we engage with are that the current exit options are either through an IPO, or a direct secondary sale. But a company might not be ready for the former, and the latter can be time-consuming and hard to understand for investors as private shares retain complex rights and obligations. Furthermore, liquidity is also limited because there is no ready market for a subsequent sale. Through our 1exchange private securities trading platform, investors can also further break their stake up into smaller units for other investors.
This is why the CapBridge approach is attractive to them.
In the traditional fashion, the size of investments tends to be quite large. For instance, venture capital investments are typically in the millions. But with CapBridge and 1exchange, we can actually break these chunks into smaller sizes to allow other investors to partake in the opportunity, leading to an increase in liquidity.
With companies and investors now being on boarded onto the platform, CapBridge’s ultimate goal is to help companies secure their required financing and investor base.
About Johnson Chen, Founder and CEO of CapBridge
Johnson Chen is currently CEO and Founder of CapBridge – a global investment syndication platform that tackles the problem of private company liquidity and allowing shareholders to realise partial exits.
For more information, please visit: https://capbridge.sg/
Workshop Title - Financial Learning Session 1 Take action today!
Nulla consectetur mauris vulputate, semper odio eu, euismod massa. Nulla nec laoreet diam, at facilisis nisi. Vivamus at nibh eu justo interdum congue. Etiam feugiat.
